STB puts railroads on notice after shipper complaints

Dive Brief:

  • In the face of complaints from two major shippers, the Surface Transportation Board (STB) is requesting status reports from six railroads: BNSF, Canadian National, Canadian Pacific, CSX, Norfolk Southern and Union Pacific.
  • Automotive and Feed & Grain associations have expressed “serious similar concerns about the reliability of the nation’s freight railroad network,” STB tells the railroads.
  • STB is looking for information such as employee resources and capacity constraints, which could explain declines in service.

Dive Insight:

Officials at STB had to be alarmed, and reacted quickly, when they received scathing letters from the National Grain and Feed Association (NGFA) and the Alliance of Automobile Manufacturers (AAM) earlier this month.

The AAM letter, which also was sent to members of Congress with committee oversight of railroads, charges, “Alliance members have not perceived even the semblance of a concerted plan or time frame to restore effective car service for transporting finished vehicles.”

The letter from the Grain and Feed Association was particularly damning, charging “an aggressive effort to reduce their operating rations to impress Wall Street investors and shareholders. This, in turn, has resulted in the systemic shedding of resources by Class I carriers, including locomotives and crews, that has degraded service to unacceptable levels, and resulted in virtually non-existent surge capacity to meet rail customers’ needs.”

STB’s letter to the railroads asked some very specific questions, requesting very specific information, though it didn’t give a response deadline. They include locomotive availability and whether there enough to meet demand in 2018; initiatives to proactively communicate with shippers regarding service issues; employee resources, inducing current head count and hiring plans; local service performance, including specific yards or locations where performance is trending below norms; and a list of points on their network where there is sustained congestion, and steps being take to remedy them.

Railroads are still a vital cog in the US economy. They play a role in feeding us and getting all sorts of goods to businesses and consumers. It would be a good thing if the railroads took these letters and criticisms to heart. And they better do it quickly, because with the AAM’s letter also going to Congress, it’s a sure bet that some politician is going to dive into the issue.

Full article by Barry Hochfelder on supplychaindive

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